6.  The applicants were born in 1944, 1946 and 1973 respectively and live in Sofia.
7.  The first and the second applicants are husband and wife and the third applicant is their daughter.
8.  In 1974 the first and the second applicants bought from the Sofia municipality an apartment of 95 square metres, which had become State property by virtue of the nationalisations carried out by the communist regime in Bulgaria in 1947 and the following years.
9.  In the beginning of 1993 the heirs of the former pre-nationalisation owner of the property brought proceedings against the first and the second applicants under section 7 of the Restitution Law.
10.  The proceedings ended by a final judgment of the Supreme Court of Cassation of 8 January 2001. The courts restored the former owners’ title, finding that the first and the second applicants’ title had been null and void ab initio on three grounds: 1) the sale contract had not been signed by the mayor, as required by law, but by another official of the municipality. Although the mayor had been authorised to delegate the power to sign contracts, he had not made a valid delegation in the case at hand; 2) the initial decision to sell the property had not been signed by the mayor of the region, as required by law, but by another official; and 3) the disputed apartment had been a part of a bigger apartment, which had on an unspecified date before 1974 been divided into two smaller ones; this division had not been carried out in accordance with the respective construction rules.
11.  The first and the second applicants could apply, within two months following the judgment of the Supreme Court of Cassation of 8 January 2001, for compensation bonds from the State. Those bonds could be used in privatisation tenders or sold to brokers. The first and second applicants did not avail themselves of this opportunity.
12.  By 2001 the three applicants were living in the apartment. In May 2001 they vacated the property.
13.  In June 2001 the heirs of the former owner brought an action for damages against them for having used the apartment unlawfully, as they had not been its owners. The claim concerned the period from 1996 to 2001 as for the preceding years it was barred by the general five-year statutory limitation.
14.  In a judgment of 31 May 2004 the Sofia District Court allowed the claim accepting that as the first and second applicants’ title had never been valid, the former owners’ title had been restored as of the date of entry into force of the Restitution Law in 1992. After that date, the applicants had had no right to use the apartment.
15.  On 7 March 2006 the Sofia City Court upheld that judgment. The applicants did not submit a cassation appeal considering that it would stand no chances of success.
16.  In June 2007 the first and second applicants paid to the former owners of the apartment 31,265 Bulgarian levs (BGN), the equivalent of approximately EUR 16,000, and the third applicant paid BGN 15,632, the equivalent of EUR 8,000.
17.  The relevant background facts and domestic law and practice concerning the effect on third parties of the denationalisation legislation adopted in Bulgaria in the 1990s have been summarised in the Court’s judgment in the case of Velikovi and Others v. Bulgaria, nos. 43278/98, 45437/99, 48014/99, 48380/99, 51362/99, 53367/99, 60036/00, 73465/01, and 194/02, 15 March 2007.
18.  In a judgment of 10 July 2003 (judgment no. 1127 in case no. 891/2002) the Supreme Court of Cassation dismissed an appeal by defendants whose title to an apartment had been found to be null and void under the terms of section 7 of the Restitution Law and who had been ordered by the lower courts to pay damages to the property’s former owners, for having used it on an invalid ground. The Supreme Court of Cassation rejected an objection by the defendants that prior to the final judgment under section 7 they had lawfully possessed the apartment at issue pointing out that their title had been null and void ab initio. It held that
“[a]s a legal category, the nullity of a legal action results in its complete incapability of producing the legal consequences sought. This incapability exists from the beginning, in other words, the contract, which has been subject to the action under section 7 [of the Restitution Law], was null and void, irrespective of when this nullity was declared by the courts.”
The Supreme Court of Cassation went on to conclude:
“... as from the date of entry of the [Restitution Law] into force, [the defendants] possessed the property on no valid legal ground and that is why this date has rightly been accepted as a starting date of [their] liability for damages.”